Among the first things I learned as a New Jersey reporter was an odd word: ratables. It came up when towns considered development proposals.
Ratables is a Jersey euphemism for property taxes. Local officials always wanted to know how much money a project would add to their coffers — and how much it would take out.
Housing was viewed as a net loser. Electeds thought it would cost more to educate new residents’ children than the development would pay in taxes and impact fees. So they blocked or downsized residential projects whenever possible.
What the politicians really wanted were offices — big ratables, no kids.
Parsippany, which I covered in the late 1990s, mastered this game. It was peppered with office campuses; my newspaper was in one, at 800 Jefferson Road. (People called them office “parks” but buildings surrounded by parking lots are not exactly green space.)
Covering Morris County changed how I saw the world. I had never thought about urban planning before encountering the horrendous design of the absurdly nicknamed Garden State. To grab lunch, I had to drive. Strip malls and their roadside signs created hideous vistas — what planners call “visual clutter.” Huge swaths of land were carved out for intersections, with 270-degree ramps instead of left-turn lanes.
New Jersey is the most densely populated state, but everyone is spread out. Its largest city, Newark, has only 282,000 people. That’s barely more than the largest neighborhood in New York City.
I spearheaded a Daily Record series, “Sprawl or Splendor?” that explored how a vision of suburban paradise had gone awry. It won first place for public service from the New Jersey Press Association. Nothing changed.
We’re stuck with suburbia, but there’s a lesson to be learned from ratables. Setting aside that isolated office complexes in a transit desert was a terrible idea, the dynamic made clear that when politicians have an incentive to do something, they do it.
How does that play out in New York City? Not well.
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Land use is dictated by the City Council, specifically by the local member for a given project or neighborhood rezoning. Little incentive exists for any one of the Council’s 51 members to approve one. The tax revenue and new constituents generated by projects come years later, by which time members are term-limited out of office or about to be.
But even without term limits, it wouldn’t matter: Property taxes go into the city’s general fund, and the mayor largely controls how it is spent.
Council approval of the annual budget is required, but the chamber cannot direct developments’ tax revenue back to the individual members who approved them. The mayor doesn’t either.
Perhaps he should.
Imagine, for example, if discretionary funding based on the projected taxes from the $2 billion Innovation QNS project were automatically allocated to the local Council member, Julie Won, to distribute in her district. Would she still have threatened to sink the project, forcing the speaker’s office to step in and negotiate a last-minute deal?
Politicians love doling out money for local programs, school upgrades, playground projects and the like. But they are afraid to defy constituents who object to more people moving into the neighborhood.
Parsippany’s town council has only five members. As in most localities, generating tax revenue is very important to them. New York City’s 51 Council members rarely mention it.
Not only are city dollars spread among 51 districts, but Council members see revenue as completely beyond their control. Money just seems to materialize, and almost always more of it than in the previous year. If revenue happens to fall, they ask Washington and Albany for bailouts.
They don’t think about growing the economy. To them, that just means more people competing for housing. Recall that Amazon’s HQ2 project in Long Island City was opposed by Jimmy Van Bramer, the local Council member.
But what if he stood to immediately get a fraction of future tax revenue from the project — say, $10 million — as discretionary funds? Would his position have been different? Is water wet?
I don’t know how to make this happen. I do know that things happen — good or bad — when incentives are aligned. And they are not aligned for individual Council members to embrace development in their districts.
Voters support new housing in concept, but not in their backyards. And a small number of people who punch above their political weight — notably the Democratic Socialists of America — oppose development that involves profit.
Except for construction and building-service workers, people who would be helped by a particular project don’t even know who they are. Their gains, and the city’s, are in the distant future. Making benefits immediate for politicians would change the conversation.
Ratables. They need ratables.